TL;DR – The SBA provided a record $30 billion in loans to small businesses in 2018. Major lending programs like 7(a) and 504 loans saw significant growth. New technology tools and initiatives helped expand access to SBA financing.
The SBA, or Small Business Administration, recently announced its lending numbers for fiscal year 2018 (FY18), highlighting that it gave more than $30 billion in various types of loans to businesses in need of capital.
“We are providing tools, resources and access to capital for America’s 30 million small businesses,” SBA Administrator Linda McMahon said. “SBA’s 7(a) and 504 loan programs have never been more dynamic.” She further explained that thanks to the SBA’s accessible and widely-used 7(a) and 504 programs, their stats for FY18 indicate small businesses are continuing to find success.
According to the SBA, during the FY18 period, there were 60,353 7(A) loans made, with a total dollar amount of $25.37 billion. This is through the Administration’s flagship program, which is designed to provide loans of up to $5 million to SBA loan approved-businesses on what it deems to be “reasonable terms and conditions,” including land or equipment acquisition and working capital.
The Administration touted its 504 program’s “high performance for lending,” saying it provided 5,874 loans, valued at $4.75 billion.
During the FY18 period, SBA also launched its new 25-Year Debenture, an offering that provides small businesses with an extra 60 months of financing at a fixed rate. In its announcement, SBA reported that over 1,000 debentures had been sold between the April launch and the last day of September. William Manger, the Associate Administrator for SBA’s Office of Capital Access, said he was pleased to see over $1 billion had made their way to small business in less than half a year.
The SBA also saw the numbers of smaller loans continue to grow, achieving a record amount of money given out by its Microloan and Community Advantage Programs. The Administration approved over $72 million in its Microloan program and over 1,000 loans (totaling more than $150 million) in its Community Advantage program. The SBA also runs the HUBZone program for small businesses in economically challenged areas.
The Administration acknowledged that technology played a significant part in its lending momentum, pointing to its Lender Match platform, which allows business owners to complete an online form, finding an authorized lender within two days. According to the Administration, this platform alone has helped to generate more than 3.5 million leads for lenders and over 160,000 unique borrowers.
Additionally, the SBA’s Franchise Directory, launched in 2018, resulted in a franchise brands reported 50-plus percentage rise in . The directory features over 3,000 brands. On a related note, the SBA says there has been a 21-percent year-over-year increase in 7(a) and 504 dollars going to franchises.
In November, the SBA announced a collaboration with the United States Department of Veterans Affairs to launch a program that offers intensive management and leadership training to veterans who are entrepreneurs. McMahon said the program is tailored to leverage the skillsets of America’s veterans, while also providing them with the resources they need to “take their companies to the next level.”
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